South Korea considers lowering 30-member threshold for franchisee associations: what Japan’s franchise sector should know

The criteria for owners of outlets in smaller franchise networks to register franchisee associations have become a point of debate in South Korea. According to an MK report dated 11 September 2026, Korea Fair Trade Commission chair Ju Byung-gi said he would consider lowering the minimum membership requirement of 30. This is not news of a regulatory change in Japan, but it offers a useful perspective on a shared challenge across the franchise community: how to bring franchisees’ views together.

Registration criteria come under scrutiny ahead of implementation

MK reported on developments in South Korea ahead of the introduction of a registration system for franchisee associations. According to the report, the Fair Trade Commission and franchise-sector representatives disagree over the criteria for registering these groups. The specific issue raised by the commission’s chair was the minimum number of members an association must have.

The report says Ju explained that he would consider lowering the 30-member threshold following concerns that it presented too high a barrier for owners of outlets in smaller networks. What the report establishes at this stage is that the concern has been acknowledged and a review is planned.

However, the report provided does not specify a proposed replacement threshold or when one might be agreed. Nor does it confirm the system’s precise commencement date, application procedures or the powers that registration would confer. It would therefore be premature to conclude that a reduction has been approved or that associations can already register under new criteria.

The report alone also does not establish the reasoning put forward by each side, or whether there are points of contention beyond membership numbers. Before judging the merits of the system, it is important to distinguish proposals under consideration from confirmed decisions.

Access for smaller franchise networks is the central issue

The significance of the chair’s remarks lies not simply in the number 30. Rather, the membership threshold is being reconsidered in terms of how easily owners of outlets in smaller networks can use the registration system.

Where registration depends on having a specified number of members, the ability to recruit that many people determines access to the system. For a smaller network, the same numerical threshold may present a greater obstacle to franchisees. Ju’s explanation can be understood as a response to concerns about this accessibility.

However, the report does not state how many brands or franchisee associations are unable to meet the threshold. It is also unclear how many outlet owners are affected, or how many additional associations would become eligible if the requirement were lowered. Recognising the needs of smaller networks as an issue is not the same as demonstrating the effects of a change.

Nor can it be assumed that lowering the threshold would immediately improve relations between franchisees and franchisors. The conditions under which an association can register are a separate matter from the role it plays once registered. When reviewing further details of the system, attention should extend beyond membership numbers to eligibility and the scope of the procedures involved.

Do not confuse this with a change to Japanese rules

For Japan’s franchise community, and overseas readers considering entry into the Japanese market, the first point to establish is the jurisdiction. This report concerns a South Korean system. It is neither an announcement by the Japan Fair Trade Commission nor news of a move to introduce a new registration obligation for franchisee associations in Japan.

The report therefore provides no basis for concluding that Japanese franchisees must gather 30 members, or for claiming that Japan is also lowering a membership threshold. Anyone checking their rights or obligations in Japan should consult official Japanese sources and the terms of their own contract.

Nevertheless, overseas developments can inform discussion about how franchisees’ views are gathered, without assuming that the same rules apply locally. Is there a clear channel for submitting views to the franchisor? Can requests shared by several franchisees be brought together? Are there opportunities to be heard regardless of the size of the network? These are useful questions for Japanese franchisors and franchisees reviewing how they communicate.

This does not mean that the report identified problems in Japan. Rather, Japan’s franchise community can use the question raised in South Korea — whether participation is accessible to owners of outlets in smaller networks — to examine its own arrangements.

What to check next: the final criteria and their scope

The first point to watch in subsequent reports is whether a reduction in the minimum membership requirement is formally approved. If it is, the details to check include not only the number of members required, but also when the change takes effect, which associations qualify and what procedures they must follow.

The second is the purpose of the registration system and the status of registered associations. The source material provided does not include these details. The word ‘registration’ alone should not be taken to imply negotiating powers or obligations on franchisors to respond.

For prospective and existing franchisees in Japan, this report alone is not a basis for changing contractual terms or business decisions. It is important to follow it as an overseas regulatory development while keeping it separate from any action required in Japan.

Practical takeaway: For now, understand the position as follows: South Korea is considering lowering the minimum 30-member threshold. Rather than anticipating a regulatory change, Japanese franchisors and franchisees should check that they have clear channels for exchanging views and procedures for discussing shared concerns.